Welcome to Strategic Brand Management

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Welcome to Strategic Brand Management
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BU692u Strategic Brand Management Spring 2005
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Agenda First Class

• Course Objectives
• Class Format
• Performance Evaluation
• Introduction to Branding

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Course Objectives

• Understanding of what a brand is and how it is
  formed
• Brand building in a variety of business contexts
• Integrated requirements for brand building,
  reinforcement, revitalization
• Models, measures, impact of brand equity
• Learn through illustration application

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Class Format

• Discuss key concepts you me
• Illustrate their application you, me, guests
• Questions for discussion tasks to be performed
  from outline
• Challenges, issues, trends
• Summarize

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Performance Evaluation

• Brand Audit Project (group) 40
• Brand Personality Assessment (individual) 20
• Brand Journal (individual) 20
• Participation (individual) 20

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Brand Audit Project

• Brand Book
• Brand History
• Assessment of current status using course
  concepts brand hierarchy, customer-based brand
  equity, brand positioning, brand mantra
• Analyses of how branding elements and marketing
  mix are contributing to this brand status
• Recommendations re building managing brand
  equity in the future
• Brand choice 2nd class April 23rd
• Presentation last class June 24th/25th

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Brand Personality Assessment

• Capturing a brands personality
• Apply Aakerss brand personality scale
• Projective techniques to create an image for your
  brand
• Use Zaltmans ZMET technique to create a collage
  for your brand
• Use Fourniers typology to describe the
  relationship that you have with your selected
  brand
• Implications from above
• Powerpoint presentation (5 slides) May 6th/7th
  session

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Example of a Brand Personality Assessment Zehrs
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zehrs Brand PersonalityBu692u Rick Beutler

• Background Kitchener, 1950 Zehrs father
  sons began family market focused on superior
  customer service, value, and quality
• acquired by Loblaw Companies in 1963
• currently 58 stores in Southern Ontario
• Slogan, Mantra The best of everything you
  need
• Value Proposition Zehrs sells quality products
  and services that provide good value at a low
  price for its customers expects to continue to
  be known as low cost operator through innovative
  and customer orientated actions expects honesty
  and integrity dealing with customers, employees,
  suppliers, and community.

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• Aakers Brand Personality Scale (like McDonalds)
• sincerity, competence, and sophistication
• X excitement, and ruggedness
• Projective Techniques (Golden Lab)
• animal (dog) activity (routine eating) fabric
  (natural cotton)
• music (mainstream top 40) vehicle (minivan)
  occupation
• (management) TV show (Everybody Loves Raymond)
• Fourniers Typology (Courtship/Compartmentalized
  Friendship)
• Interdependence committed Self Concept
  engaged
• Commitment engaged Love/Passion engaged
• Intimacy engaged Partner Quality -- committed

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zehrs ZMET Collage
Most Representative High value, one-stop
shopping for people on the go
Friendly service
Strong presence in Community
Quality, healthy food
Boring, daily errand
Convenient, not just food
Private and national brands, value priced
Active, suburban families
Celebration, Family Friends
Availability, costs a bit more
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ABBREVIATIONS A Aaker F Fournier P
Projective Z ZMET

• SYMBOLS
• Mid To High Score
• X Below Mid Score
• ? Not Enough Data

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Implications to Build Enhance zehrs Brand Equity
Goal Weakness To Do
Achieve all level in CBBE Pyramid Imagery Profiles PerformancePrice Feelings Fun Excitement Carefully develop assess integrated marketing plan to address weaknesses while retaining strengths, since scores well overall. Revise value proposition mantra re target segment, PoP, PoD.
Imagery -- Profiles Surveyed only medium to high income individuals and families Conduct quantitative market survey of primary and secondary target seg-ments to validate findings regarding demographics, income levels, etc.
Performance Quality Service at Low Price Perceived value proposition is pay higher price for quality service Survey target segments to determine what perceived price level erodes brand equity. Target consumers may accept value rather than low price.
Feelings Fun Excitement Perception is boring, errand, life necessity Add treasure hunt appeal, e.g.. High profile short term special merchandise buys, vendor sponsored contests, etc.
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Brand Journal

• 10 or more articles that address topic of
  branding
• Concept illustrated in the article and its
  implications for marketers a crisp paragraph
  for each article
• Articles can be discussed through the term
• Journal to be submitted June 18th

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Participation

• Class discussions
• Journal examples
• Interaction with guest speakers
• Value added contributions

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Questions for Discussion

• What is a brand? How is it formed?
• Can anything be branded? Are you a brand?
• How does branding affect consumer behaviour?
• What are the challenges to branding in todays
  marketplace and what are the implications for
  marketers?

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What is a Brand?

• Traditional view -
• A brand is a name, term, sign, symbol, or design
  which is intended to identify the goods or
  services of one seller or group of sellers and to
  differentiate them from those of competitors.
• More recent views
• Brand is what is experienced and valued by
  customers in everyday social life.
• Brand is the culture of the product shared
  taken for-granted brand stories, images, and
  associations
• Brand is the mental and emotional file we have
  for a product or service or entity.

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2 Managing a Brand Image through Marketing
A brand is a living entity and it is enriched
or undermined cumulatively over time, the
product of a thousand small gestures. Michael
Eisner, CEO Disney
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1971 For a fee of 35, the Swoosh trademark was
created by a graphic design student named
Carolyn Davidson.
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Before Nike there were sneakers.
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Before Coca-Cola there were soft drinks.
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Before STARBUCKS there were coffee shops.
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Before Microsoft there were software
applications.
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Before Nokia there were cell phones.
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Catalysts for Branding - Interbrand

• New offering, new promise
• Strong, nimble competition
• Sophisticated, savvy demanding customers
• Price margin pressures
• Sales market share pressures
• Combinations divestitures
• Organic growth
• New revenue streams
• Share price performance
• Employee attraction, retention, productivity

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New Branding Challenges

• Brands are important as ever
• Consumer need for simplification
• Consumer need for risk reduction
• Brand management is as difficult as ever
• Savvy consumers
• Increased competition
• Decreased effectiveness of traditional marketing
  tools and emergence of new marketing tools
• Complex brand and product portfolios

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Brand Explosion
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Branding by Retailers Example Walmarts 5 Next
Victims Forbes 11/12/2004

• Consumer Electronics Best Buy 1, Walmart 2
  but recently rolled out private brand ILO.,
  expanded brand relationships with Sony, RCA,
  Panasonic
• Banking trying to get into banking but thwarted
  by regulators, instead it offers check cashing,
  bill payment, money orders boasts 28 Wal-Mart
  Money Centres operated by Sun Trust Banks plus it
  has I-store bank branches with other banks
• Pharmacy currently 4th in pharmacy business,
  rolling out a handful of 24hr pharmacies
• Gasoline 1555 stations on Wal-Mart properties,
  300 of which are operated by Sams Club, rest by
  Murphy
• Fashion bought 1 selling British apparel brand
  George from Asda, licenses Mary-Kate Ashley
  lines from the Olsen twins

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Necessities Brand Portfolio
Premium Quality
Premium National Brand
Sams Choice
Great Value
National Brand
Same as for Less
Quality
Special Kitty
EverActive
Equate
Equate
Ol Roy

Fit for Purpose
D 46 Pharmacy / OTC
D 02 HBC
D 82 Impulse
D 07 Pets
Private Brand
D 04 Cleaners Paper Goods
License
National Brand
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Branded Value-Added Chain
Regional Brands
Kraft Heinz
Presidents Choice
Gourmet
No Name
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The Customer/Brand Challenge

• In this difficult environment, marketers must
  have a keen understanding of
• customers
• brands
• the relationship between the two

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The Concept of Brand Equity

• The brand equity concept stresses the importance
  of the brand in marketing strategies.
• Brand equity is defined in terms of the marketing
  effects uniquely attributable to the brand.
• Brand equity relates to the fact that different
  outcomes result in the marketing of a product or
  service because of its brand name, as compared to
  if the same product or service did not have that
  name.

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Auto Example
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The Concept of Customer-Based Brand Equity

• Customer-based brand equity
• Differential effect
• Customer brand knowledge
• Customer response to brand marketing

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the publics perception
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Determinants of Customer-Based Brand Equity

• Customer is aware of and familiar with the brand
• Customer holds some strong, favorable, and unique
  brand associations in memory

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In which product categories to you exhibit strong
brand loyalty? Why?
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Lovemarks Love/Respect Axis
Respect Performance, Trust, Reputation
Brands Low Love, High Respect
Lovemarks High Love, High respect
Love Mystery, Sensuality, Intimacy
Products Low Love, Low Respect
Fads High Love, Low Respect
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How to put Love in your Brand

• Find your most passionate customers and listen to
  them
• Put your brand through the love-respect axis
• Start telling stories show your brand as part
  of an experience, a myth, or a dream

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Building Customer-Based Brand Equity

• Brand knowledge structures depend on . . .
• The initial choices for the brand elements
• The supporting marketing program and the manner
  by which the brand is integrated into it
• Other associations indirectly transferred to the
  brand by linking it to some other entities

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Examples?
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Benefits of Customer-Based Brand Equity

• Enjoy greater brand loyalty, usage, and affinity
• Command larger price premiums
• Receive greater trade cooperation support
• Increase marketing communication effectiveness
• Yield licensing opportunities
• Support brand extensions.

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Brand Power Global Business Week, August 2004
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The continuously strong rise of Samsungs brand
value reflects the companys commitment to invest
in its brand on a global scale and make brand
value a key corporate target throughout the
organization, including the CEO and all
employees. -Jan Lindemann, Global Managing
Director of Interbrand
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Brand Value in 2003 US 10.8 billion (31
increase from 2002)
A result of making brand building the key focus
in their marketing strategy
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Brand Power - Canada
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Customer-Based Brand Equityas a Bridge

• Customer-based brand equity represents the added
  value endowed to a product as a result of past
  investments in the marketing of a brand.
• Customer-based brand equity provides direction
  and focus to future marketing activities

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The Key to Branding

• For branding strategies to be successful,
  consumers must be convinced that there are
  meaningful differences among brands in the
  product or service category.
• Consumer must not think that all brands in the
  category are the same.
• PERCEPTION VALUE

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Strategic Brand Management

• Strategic brand management involves the design
  and implementation of marketing programs and
  activities to build, measure, and manage brand
  equity.
• The strategic brand management process is defined
  as involving four main steps
• 1) Identifying and establishing brand
  positioning and values
• 2)  Planning and implementing brand marketing
  programs
• 3)  Measuring and interpreting brand performance
• 4)  Growing and sustaining brand equity

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Strategic Brand Management Session2 Building
Brand Equity

• Customer-based brand equity
• Six brand building blocks brand salience, brand
  performance, brand imagery, brand judgments,
  brand feelings, brand resonance
• Building strong brands advantages
• Brand positioning its role in building brand
  equity
• Internal branding
• Brand values
• Brand mantra

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Questions for Discussion

• Customer-based brand equity its advantages?
• Two pairs of brands sources of brand equity
  implications?
• Points of parity? Points of difference?
  Implications for positioning?
• Brand resonance which brands? Why?
  Implications?
• Beverage category?
• Brand mantra for one of your favourite brands?

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Motivation forCustomer-Based Brand Equity Model

• Marketers know strong brands are important but
  arent always sure how to build one.
• CBBE model was designed to be
• comprehensive
• cohesive
• well-grounded
• up-to-date
• actionable

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Rationale of Customer-Based Brand Equity Model

• Basic premise Power of a brand resides in the
  minds of customers
• Challenge is to ensure customers have the right
  types of experiences with products services and
  their marketing programs to create the right
  brand knowledge structures
• Thoughts
• Feelings
• Images
• Perceptions
• Attitudes

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Building Customer-Based Brand Equity

• Building a strong brand involves a series of
  steps as part of a branding ladder
• A strong brand is also characterized by a
  logically constructed set of brand building
  blocks.
• Identifies areas of strength and weakness
• Provides guidance to marketing activities

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Salience Dimensions

• Depth of brand awareness
• Ease of recognition recall
• Strength clarity of category membership
• Breadth of brand awareness
• Purchase consideration
• Consumption consideration

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Performance Dimensions

• Primary characteristics supplementary features
• Product reliability, durability, and
  serviceability
• Service effectiveness, efficiency, and empathy
• Style and design
• Price

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Imagery Dimensions

• User profiles
• Demographic psychographic characteristics
• Actual or aspirational
• Group perceptions -- popularity
• Purchase usage situations
• Type of channel, specific stores, ease of
  purchase
• Time (day, week, month, year, etc.), location,
  and context of usage
• Personality values
• Sincerity, excitement, competence,
  sophistication, ruggedness
• History, heritage, experiences
• Nostalgia
• Memories

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Judgment Dimensions

• Brand quality
• Value
• Satisfaction
• Brand credibility
• Expertise
• Trustworthiness
• Likability
• Brand consideration
• Relevance
• Brand superiority
• Differentiation

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Feelings Dimensions

• Warmth
• Fun
• Excitement
• Security
• Social approval
• Self-respect

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Resonance Dimensions

• Behavioral loyalty
• Frequency and amount of repeat purchases
• Attitudinal attachment
• Love brand (favorite possessions a little
  pleasure)
• Proud of brand
• Sense of community
• Kinship
• Affiliation
• Active engagement
• Seek information
• Join club
• Visit web site, chat rooms

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ApplicationIdentify the key drivers of brand
equity
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Value to the Marketer

• Drives customer behaviour loyalty
• Pricing scope
• Synergistic effects with other elements of mix
• Growth potential extensions, co-branding,
  licensing
• Leverage with the trade
• Profits shareholder value -
• Deutsche Securities

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Another perspective 4 Dimensions of Brand Value
Linked to the Brands Culture

1. Reputation value brand serves as containers of
   reputation shape perceived quality
2. Relationship value shape relationship
   perceptions B2B services
3. Experiential value frame customer experiences
   heuristic thinking
4. Symbolic value express values attitudes
   status, lifestyle, politics, aspirational
   identities

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Your paired examples?
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Brands with Resonance? Why?
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Brand Positioning

• Define competitive frame of reference
• Target market
• Nature of competition
• Define desired brand knowledge structures
• Points-of-parity
• necessary
• competitive
• Points-of-difference
• strong, favorable, and unique brand associations

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Issues in Implementing Brand Positioning

• Establishing Category Membership
• Identifying Choosing POPs PODs
• Communicating Establishing POPs PODs
• Sustaining Evolving PODs POPs

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Establishing Category Membership

• Competitive sets change over time e.g., beer
  wine vs hard liquor, bottled water vs soda
• Short term vs long term perspective Fedex vs
  email, video stores vs downloads, VOIP vs long
  distance
• Product proliferation intra brand competition
• Usage situation influences brand competition
  home vs out, gift vs personal

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Identifying Choosing POPs PODs

• Desirability criteria (consumer perspective)
• Personally relevant
• Distinctive superior
• Believable credible
• Deliverability criteria (firm perspective)
• Feasible
• Profitable
• Pre-emptive, defensible difficult to attack

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Major Challenges in Positioning

• Find compelling impactful points-of-difference
  (MacMillan McGrath, HBR, 97)
• How do people become aware of their need for your
  product and service?
• How do consumers find your offering?
• How do consumers make their final selection?
• How do consumers order and purchase your product
  or service?
• What happens when your product or service is
  delivered?
• How is your product installed?
• How is your product or service paid for?

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Major Challenges in Positioning

• Find compelling impactful points-of-difference
  (cont.)
• How is your product stored?
• How is your product moved around?
• What is the consumer really using your product
  for?
• What do consumers need help with when they use
  your product?
• What about returns or exchanges?
• How is your product repaired or serviced?
• What happens when your product is disposed of or
  no longer used?

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Communicating Establishing POPs PODs

• Create POPs and PODs in the face of attribute
  benefit trade-offs
• Price quality
• Convenience quality
• Taste low calories
• Efficacy mildness
• Power safety
• Ubiquity prestige
• Comprehensiveness (variety) simplicity
• Strength refinement

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What makes a brand different?

• Recent study of customers, perceptions of top
  brands in airlines, coffee, beer, fast food,
  hotels, long distance telephone, soup in terms of
  functional, economic, psychological, social,
  cultural factors
• Findings
• Brand type can be more important than category to
  positioning of a brand
• Within category hierarchy in terms of five
  factors rated functional economic most
  desirable but cultural, social, psychological
  most closely related to choice
• Functional economic cost of entry or parity
  factors
• Cultural, social, psychological point of
  difference or differentiators

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Re-Imagine by Tom Peters Insights on
Experiences Dreams

• Harley Davidson does not sell motorcycles,
  Starbucks does not sell coffee, Club Med does not
  sell vacations, Guinness does not sell beer
  what do they provide?
• Experience a way of life, indelible memory,
  wanting more, member of a club, viral marketing
  agent, defines who you are
• Dreamketing touching the clients dreams, art of
  telling stories entertaining,promoting the
  dream not the product, building the brand around
  the main dream, building buzz, a cult

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Performance Features Mckinsey Quarterly 2003,
Vol 4
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Example of Retailer
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Sustaining EvolvingPOPs PODs

• Core Brand Values
• Core Brand Proposition

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Core Brand Values

• Set of abstract concepts or phrases that
  characterize the 5-10 most important dimensions
  of the mental map of a brand.
• Relate to points-of-parity and points-of-differenc
  e
• Mental Map ? Core Brand Values ? Brand Mantra

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Mental map for your selected brand?
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Brand Mantras

• A brand mantra is an articulation of the heart
  and soul of the brand.
• Brand mantras are short three to five word
  phrases that capture the irrefutable essence or
  spirit of the brand positioning and brand values.
  
• Nike
• Authentic Athletic Performance
• Disney
• Fun Family Entertainment

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Your Examples?
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Some Branding Trends/Challenges Fast Company
August 04

• Brands will be authentic increased transparency
  broad scrutiny
• Experience will be the expression of the brand
• Brands will be hard-wired into our brains
• Line between entertainment brands will blur
  be where people are and involved in what they
  value
• Increasingly complex brands will require new
  organizational structures- broader responsibility
  for ownership
• Brands will create social cultural values
• America will be reborn as a more culturally
  sensitive brand

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Topics of Interest from AMA SIG on Brand Strategy
Brand Management

• Brand measurement approaches, barriers,
  importance
• Brand loyalty organizational issues
• Outsourcing strategic partnering brand
  ownership control
• Brand the CEO
• Brand the web
• Brand value how is it created/destroyed?
• Brand standards

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Summary

• Customer-based brand equity is the differential
  effect of brand knowledge on customer response to
  the marketing of a brand
• Positive brand equity results when customers are
  familiar with a brand and have strong, favourable
  and unique associations for it
• Power of brand resides with customers
  hierarchical structure or foundation
• Positioning strategies can influence the
  knowledge structures customers have for a brand
• Brand positioning requires reference points
  target market, competitive arena, POP POD
• POP POD used to established unique positions
• Internal branding efforts are important

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Next Day with Brad

• Brand building strategies brand elements
  marketing mix, secondary associations
• Chapter readings
• Assignments